Accounting/Financial Methods

[rosechester]

I feel I need to be more profitable and feel like billables are not in line with other companies in my area. I found a book from Zweig White Research and it lists many items I am in need of revamping such as fees and billing. I am an office manager for a small engineering and land surveying company in monmouth county, new jersey. Has anyone heard of Zweig White? What software program are some of your firms using for billing and time sheets? What process does a job go through from the time the proposal is signed and deposit is paid? these are the types of questions I have. Can this website and forum help me? I would appreciate some other ideas as I think mine are getting stale. I would appreciate any comments from the financial end of engineering.

 

[cmgroup]

Rosechester,

Zeig White is a firm that provides information to design and construction firms. Here is their url:

http://www.zweigwhite.com/about/index.asp.

I became aware of them through my free professional subscription to CE News.

I am a small firm with less than 5 employees and I use QuickBooks Pro by Intuit. Quickbooks has special versions for consultants. However, this may not be the ideal software for you as you read the rest of my response below...

Once the proposal is signed, you need to set up the project in your accounting system: initial project budget (includes cost items in client proposal, other company costs that may not be listed in the proposal, contingency, etc.). You will want to be able to track the on-going project costs with estimate to complete against the original budget. This comparison will allow you to see if you are going to break even and will allow you to have a historical record - see more discussion on historical record later in this message.

At the same time, you need to set up the project schedule. Depending on the size of the project you, or the project manager/engineer, can use software or this can be done by paper/pencil method. Input any milestones and deliverables into the schedule that were listed in the proposal.

As part of the proposal process, both a project budget and schedule should be prepared and used as the basis for the project budget and schedule used for tracking once the proposal is signed.

You will also need to advise the project managers and engineers how to charge their time to the project. You will also want to make sure that all time is charged to the project, whether you invoice for it or not - sometimes this needs to be reviewed with the firm owners or president.

(Actual time will provide a historical record for use in proposing the next similar project, even though the current project may show a loss due to hours charged that exceed what was in the proposal, and therefore not billable, unless the additional hours are due to bona-fide change order work that has been added to the project via change order.)

I hope that this is helpful and I haven't told you what you already know...

Regards,
CM Group

 

[civilperson]

Raise your rates until the work backlog shrinks. List deliverables and excluded items in all proposals with a cost list for adding excluded atems.